PALO ALTO, U.S. -- Didi Global is re-evaluating its plan to launch services in the U.K. amid uncertainties brought by Beijing's recent crackdown on the ride-hailing giant, according to a source familiar with the situation.
The company obtained operating licenses in several northern U.K. cities, including Manchester, Salford and Sheffield, right before China's Cyberspace Administration launched an investigation into Didi Global for allegedly breaching national security with its data management.
The scrutiny from Beijing came two days after Didi's New York IPO. The company's apps have been removed from app stores in China over the data security controversy. Didi's shares have fallen nearly 50% since the first day of trading in June.
The British news outlet Telegraph on Monday reported Didi has suspended plans to launch in the U.K. and continental Europe.
A source familiar with the situation told Nikkei Asia that the recent regulatory changes in China have added to the complexity of launching services in Europe, and has led to a re-evaluation of the plan. The date for the launch has not been set, the source said, adding that other factors are also affecting its planning.
"The U.K. and Europe are very complicated markets to launch a ride-hailing service with local regulations like GDPR," the source said, referring to the European Union's data protection regulation.
Asked for comment, a Didi representative said: "We continue to explore additional new markets, liaising with relevant stakeholders in each and being thoughtful about when to introduce our services. As soon as we have any more news on additional new markets, we look forward to sharing."
In preparation for launching its service in Europe, Didi set up a small team in the U.K.
"We have established an international talent hub in the U.K., recognizing the exceptional quality of people in the market," the representative added. "Beyond that, any personnel matters remain strictly confidential."
Didi currently operates in 16 countries across five continents, having recently launched services in South Africa, Ecuador and Kazakhstan. But China remains the company's main revenue driver, with foreign markets accounting for 1.6% of total revenue.
However, Didi is investing heavily in international expansion to fuel future growth as the domestic market matures. The company's international operations lost 1 billion yuan ($155 million) during the first three months of the year, according to the latest earnings report.
The ride-hailer faces intense competition from the likes of Uber and Lyft in the global market, where Didi has invested billions in expansion. It launched food delivery services in Japan in April 2020 and now ranks as the second-largest ride-hailing platform in Latin America, the filing shows.